CBN, NNPC clash over alleged diversion of $49.8bn

by Akintomiwa Agbaje


The failure of the Nigerian National Petroleum Corporation (NNPC) to remit $49.8bn (about N8tn) oil proceeds to the Federation Account of the Central Bank of Nigeria (CBN) between January 2012 and July 2013 has caused pandemonium in higer circles of goverment.

The Nigerian Eye reports:

An online news medium, SaharaReporters, reported on Monday that the Governor of the Central Bank of Nigeria, Mr. Lamido Sanusi, had written to President Goodluck Jonathan to complain about the failure of the NNPC to remit the said amount to the Federation Account in contravention of extant laws.

He said the amount represented 76 per cent of the value of crude oil lifting during the period.

The complaints are contained in the letter to the President dated September 25, 2013.

However, the corporation refuted the claims that it diverted the said amount, adding that the allegation by the CBN governor was borne out of misunderstanding of the workings of the oil and gas industry and the modality for remitting crude oil sales revenue into the Federation Account.

Some operators in the sector, who spoke on the issue in an interview with our correspondent on Tuesday, called for an in-depth probe into the scandal, stressing that the CBN had to come up with the ‘facts’ because of the frustrations it was encountering in dealing with the corporation.

Sanusi had said he was constrained to bring the huge anomaly, which he noted had lingered for years, to the notice of the President.

An oil marketer told our correspondent that some of the illegal activities being perpetuated by the NNPC would not have been successful if the corporation was not tactfully being supported by the senior government officials.

The marketer, who pleaded not to be named because of the sensitive nature of the issue, said, “It is sad to see this kind of report in the papers. The truth, however, is that there is no way the NNPC will be able to carry out this kind of fraud without the assistance of the minister of Petroleum Resources.”

However, the NNPC said in a statement on Tuesday evening that the CBN governor misunderstood how remittances on crude oil sales were being undertaken.

The General Manager, Media Relations Department, NNPC, Dr. Omar Ibrahim, said, “For the avoidance of doubt, it needs to be stated that the figure of 594.024 million barrels of crude oil given by the CBN as the total crude oil lifting for the period of January 2012 to July 2013 does not represent the correct picture of crude oil lifting for the period.

“From our records, the correct figure is 618.55 million barrels. This shows that the CBN understated the actual crude lifted by 4.13 per cent.”

He explained that the revenues from crude oil lifting were in various categories, namely equity crude; Petroleum Profit Tax, royalty, third party financing and the Nigerian Petroleum Development Company.

Ibrahim said revenues from each of the categories were statutorily being collected by different agencies of the government.

He said the corporation was collecting only one of the aforementioned categories, the equity crude.

“The Petroleum Profit Tax is collected by the Federal Inland Revenue Service; royalty goes to the Department of Petroleum Resources; third party financing goes for the research and development programme and satellite fields development, while the NPDC goes to the NPDC for upstream development,” the statement explained.

Ibrahim said while the NNPC was paying proceeds from equity crude directly to the Federation Account with the CBN, the FIRS and DPR were paying the PPT and royalty respectively into the same account.

The sum total of the proceeds makes up the alleged unremitted revenues, according to him.

He said, “The 24 per cent of total crude oil revenue receipts, which the CBN governor is reported to have acknowledged that NNPC remitted, represents the proceeds from the equity lifting which NNPC is directly responsible for.

“The alleged unremitted 76 per cent was paid to the agencies that are statutorily empowered to receive them for onward remittance into the Federation Account.”

He stressed the need for institutions of the Federal Government and top government functionaries to seek understanding of issues that were not clear to them from relevant agencies rather than go public with misleading information that was capable of creating public disaffection.

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